The midfielder had already signed a pre-contract agreement to join Spurs on a free transfer in the summer but the clubs have now agreed a fee to accelerate the move before the close of the January transfer window.

Goal.com understands Holtby will join the north London club on a four-and-a-half year contract with the further option of a one-year extension.

Tottenham chairman Daniel Levy has been locked in talks with Schalke general manager Horst Heldt over the last two weeks before finally agreeing a deal on Sunday night as the Londoners look to bolster their squad to aid their push for a top-four finish.

The two sides could also play each other in a summer friendly as part of the agreement.

Schalke are on the verge of signing Brazilian midfielder Michel Bastos from Lyon and had been keen to recoup a transfer fee for Holtby, whose contract with the German club expires at the end of the season.

Spurs manager Andre Villas-Boas had played down the prospect of Holtby arriving at White Hart Lane earlier than scheduled but had privately been eager to bring in the 22-year-old following the knee injury that has ruled out Sandro for the rest of the season.

Holtby’s early arrival could mean that Tom Huddlestone or Jake Livermore leave on loan before the transfer window closes on Thursday night.

Spurs announced earlier this month that they had reached an agreement with Holtby having tracked the Germany under-21 captain for a month and beaten bitter rivals Arsenal to his signature.

The move will see him leave Germany for the first time after spells with Alemannia Aachen, Bochum and Mainz before moving to Schalke in the summer of 2009.

Holtby, who has an English father and is a lifelong Everton supporter, has made 79 appearances in all competitions for Schalke and has scored 13 times for the club, while he has also earned three caps for the senior German national side.